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Hi Ray:
If I can determine the number of units to trade for stock based on
the formula, but how can I determine the number of units to trade for
this stock's option? Do you have any suggestion please?
Thank you
Eric
--- In equismetastock@xxxxxxxxxxxxxxx, "Raymond McBoyd"
<rmcboyd@xxxx> wrote:
> Chichungchoi:
>
> The formulation I gave is to determine the "bet size". In other
words, a
> coefficient has to be established so one can decide how many units
to
> put on. If you know your largest losing trade amt and you have
> determined optimal f, this quotient (#2/#3)is then divided into your
> acct size and the result is the number of units for the trade.
>
> You should note that optimal f is not static. As such, bet size will
> change from trade to trade.
>
> Ray
>
>
> > Date: Wed, 11 Aug 2004 03:28:28 -0000
> > From: chichungchoi
> > Subject: Re: Money Management
> >
> > Hi Ray:
> >
> > 1) The account size is $25,000.
> > 2) The largest losing trade is $2,050.
> > 3) The Optimal f is 27%.
> > =============================================================
> > 4) $7,592 = ($2,050 / 0.27).
> > 5) 3.29 units = $25,000 / $7,592.
> > I don¡¦t understand what to do with this step(4) and (5), could
you
> > please describe more? Does this step only use for comparing two
> > system for better performance?
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